Mayor Lurie proposes to raise certain taxes to fund SFMTA's $322M budget deficit

SAN FRANCISCO (KGO) -- San Francisco Mayor Daniel Lurie laid out his plan Wednesday to potentially raise certain taxes in the city.

In a letter to transit leadership, the mayor highlighted the need for voters to pass the funding measure next year, saying it would help close the San Francisco Municipal Transportation Agency's $322 million deficit.

Lurie writing, in part:

"We believe that a parcel tax is the best mechanism to generate the level of funding needed to support Muni service and that it can be structured in a way that is fair and affordable."

Lurie's proposal is one of two possible measures being considered to fund local transit agencies.

In addition to the parcel tax measure in San Francisco, there's also a regional sales tax increase. That would be decided by voters not only in the city, but also the Peninsula, South Bay and East Bay.

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David Canepa is the President of the San Mateo County Board of Supervisors.

"If Caltrain fails, if our system fails, gridlock on the highways like you can't believe," he said.

The regional measure has received pushback from some officials in San Mateo County, who say their constituents would shoulder an unfair share of the burden of bailing out transit agencies based elsewhere.

But Canepa believes transportation is a Bay Area-wide issue.

"The numbers are with us. The data is with us. We got to keep going and give voters the chance," Canepa said.

If both measures are placed on the November 2026 ballot, it means people in San Francisco would be voting on two separate measures.

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Something that could be confusing says political scientist Melissa Michelson.

"There's going to be a lot of information thrown at voters, and for some folks that's going to be really overwhelming," she said.

Some transit agencies say, even if both measures pass, it still might not be enough to completely close their budget deficits.

That's why some like SFMTA are already instructing their departments to make further cuts.

"We need in this budget cycle to identify through one-time sources, new revenue or expenditure cuts, a way to bridge ourselves to '27-'28 when the money from the regional revenue measure starts to flow," said SFMTA's Bree Mawhorter.

SFMTA says their departments have until October 10 to submit their proposals for cuts.